The UK’s National Wealth Fund (NWF) has committed £600m to a major infrastructure upgrade led by ScottishPower, as part of a £1.35bn financing package aimed at accelerating the transition to clean energy.
The funding will support seven key transmission projects to strengthen the UK’s electricity grid, connecting more renewable energy from Scotland’s wind farms to homes and businesses across Great Britain. The package is being co-financed by a syndicate of commercial banks led by Bank of America as Sole Debt Arranger and includes commitments from Bank of America, BankInter, BNP Paribas, Caixabank, Lloyds Bank, NatWest and Banco Sabadell.
ScottishPower, a subsidiary of Spanish utility giant Iberdrola, will use the investment to deliver critical grid upgrades. These include the Eastern Green Link 1 and 4 interconnectors between Scotland and England, which will address congestion bottlenecks and unlock greater capacity to transport green energy. Five additional Scottish sites will benefit from new substations and transmission improvements to boost grid resilience.
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Chancellor Rachel Reeves hailed the deal as a key part of the government’s “Plan for Change,” promising lower energy bills and economic growth. Energy secretary Ed Miliband added that speeding up grid upgrades was vital to delivering the UK’s Clean Power 2030 targets.
The investment comes amid mounting concern over the pace of grid infrastructure development. The National Energy System Operator has estimated that up to £60bn will be required by 2030 to modernise the electricity network and meet growing demand for clean power.
The NWF said its contribution is designed to catalyse further private investment. Iberdrola plans to invest £24 billion through ScottishPower by 2028 in UK grid and renewable energy projects.
ScottishPower CEO Keith Anderson described the investment as “a welcome step forward” in bringing more renewables onto the system, while NWF chief executive John Flint called grid upgrades “one of the most significant barriers to decarbonising our economy”.
